Nifty can Bounce Above 9532 in Coming Days – Elliott Wave Analysis

| May 25, 2017

Nifty opened mild higher at 9410, declined till 9386 and then bounced to register day’s high 9431 but failed to sustain at higher levels and declined sharply by 90 points from high to register day’s low 9341 before closing 25 points down at 9360.

Yesterday, a possibility of Triple Zigzag correction was expected within the decline from 9532. And Nifty was expected to bounce towards 9436-9460 after breaking above 9387 and also suggested to buy Nifty above 9387 using stoploss of 9369 expecting targets 9436-9460. Nifty bounced from 9386 at morning but bounced till 9431 (5 points short of minimum target and then decline back below 9370). Let’s have a fresh look at latest charts for further scenario.

Today I am covering bounce from 19 Apr 2017 low 9075 and this report is further update on my previous analysis report Elliott Wave Analysis and Further Updates on Nifty Movement for 24 May 2017 Onward

Elliott Wave Counts of Nifty for 25 May 2017

Elliott Wave Counts of Nifty for 25 May 2017

This is hourly time bar chart of Nifty covering bounce after 9075 which I am expecting as start of new wave. This is the same chart with explanation which I had explained in my last analysis report because there is no major change in wave counts on this chart.

It seems an impulse is completed from 9075-9532 as shown on chart. Wave (5) of this impulse is highly extended with projected higher than 61%. Inner wave (v) of (5) started from 9372 is also highly extended.

38% retracement of this whole impulse is placed at 9357 which is already achieved yesterday and Nifty registered the low of 9341.

But when we look at the decline from all time high 9532 then it looks like a progress of Complex Correction which can take Nifty above new high 9532 again. So, let’s have a separate look at pattern of decline started from all time high 9532.

This is 15 minute time bar chart of Nifty covering decline from all time high 9532.

Elliott Wave Counts of Nifty for 25 May 2017

Elliott Wave Counts of Nifty for 25 May 2017

It seems an (abc) cycle is completed from 9532-9391 followed by a correction bounce till 9498 but I am not able to identify the pattern of further decline from 9498-9341. On the other hand, this decline is not following the rules of Triple Zigzag yet because pattern is broken if I try to draw the lines of pattern.

But overall, the whole decline from 9532 is carrying the personality of Corrective Pattern which is complex to identify. And this pattern can take Nifty above life time high 9532 again after completion.

Structure of pattern: Structure of pattern of decline is indicating it most probably a corrective pattern but Nifty can give a sharp crash like decline if it is not a Corrective Pattern. So, we needs to keep these conditions in mind while planning trade.

For Short Term, very last impulse started from 9431 projected more than 61% with respect to previous waves, thus extended wave. So, Nifty has possibility to bounce towards 9431 in short term.

Conclusion:

The decline from 9532 in Nifty is making the pattern Complex and carrying the personality of Corrective Pattern which can take Nifty above 9532 but I am not able to calculate bottom at this point of time. And there is the rare possibility of sharp decline like crash if the pattern of decline from 9532 is not corrective.

For short term, Nifty has possibility to bounce towards 9431 again.

Trading Point of View:

For Positional, we need to wait for clarity in pattern to initiate a positional trade so that we can calculate exact stoploss and can trade with good risk reward.

Otherwise, as Nifty has possibility to break above 9532 in near term, so Nifty 9500 June Call can be bought in light quantity if get Nifty in 9370-9340 range and hold for further updates.

For Intraday, Nifty if break above 9370 then light longs can be taken at 9371 using stoploss of 9359 expecting minimum targets 9420-9431. But enter trade only if getting good risk reward otherwise avoid this trade if Nifty already bounced above 9400.

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Category: Nifty

About the Author ()

Deepak Kumar is an independent Technical Analyst, regular practitioner and Trainer of Elliott wave theory applying Elliott's Wave Principles on Indian Markets successfully since 2011 and made many accurate predictions. He is also the author of book "Practical Application of Elliott's Wave Principles by Deepak Kumar"